Credit and finance for MSMEs: The amount pending to be cleared by central ministries, central departments, and central public sector units (CPSUs) to MSMEs stood at Rs 2,679.22 crore in 2,886 delayed payment applications and cases as of March 2, 2022, official data showed. According to the information available on the delayed payment monitoring portal by the MSME ministry MSME Samadhaan, CPSUs had the highest amount pending at Rs 2,123 crore vis-a-vis central ministries and departments which were yet to clear MSME dues amounting to Rs 211 crore and Rs 343 crore respectively.
Likewise, the pending complaints against CPSUs were higher at 1,840 in comparison to 757 and 289 complaints pending with central departments and ministries respectively since the launch of the Samadhaan portal in October 2017.
The data further showed that among CPSUs, Bharat Sanchar Nigam Limited (BSNL) had the highest pending amount at Rs 464.15 crore followed by Bharat Heavy Electricals
Overall, the delayed amount payable to MSMEs across all buyer types including state governments and PSUs, railways, proprietorships and more was Rs 18,275 crore across 62,734 applications and cases so far. MSMEs had filed 1.34 lakh delayed payment applications till date involving Rs 34,294 crore, of which only 23,585 cases involving Rs 4,440 crore were disposed by the facilitation councils.
Also read: Union Budget 2023: Solving MSMEs delayed payment issue cleverly
Notably, to address the delayed payment issue by large enterprises, Finance minister Nirmala Sitharaman in her budget announcement this year had proposed to amend section 43B of the Income Tax act with a new clause (h) in order to include payments made to such enterprises. The amendment will allow buyers to seek payment made to MSMEs as tax deduction only when the payment is actually made to MSMEs instead of shown as accrued payable. If not cleared, the amount pending will be treated as income and the buyer will be taxed.
Section 43B provides a list of expenses allowed as deduction under the head ‘Income from business and profession’ only in the year of actual payment instead of the year when it was incurred as an expense.